When should a variable be included in the regression? Suppose you are doing a study to asses the effect of a state tax levied on large sodas, on the rates of diabetes across states. You hypothesize that higher taxes on large sodas will cause people to consume less sugar, thereby resulting in fewer instances of diabetes and propose the following model:
B0+B1 tax +B2 percmale +B3 perc18 +u diabetes
where
diabetes rate of diabetes in the population
tax level of taxes on large sodas
percmale percentage of the population that is male
u error term
Suppose males are genetically more predisposed to develop diabetes than females, and that the passage of tax laws is independent of the gender breakdown of the state.
True or False: Including a variable to control for the percentage of males in the population would reduce the error variance while not inducing mutlicollinearity
A. True
B. False

Alandowner and his neighbor purchased adjoining undeveloped lots. after both built homes on their respective lots, the landowner suggested to the neighbor that a common driveway be built where the two lots joined. the neighbor agreed. the landowner and the neighbor split the cost of constructing the driveway and entered into a written agreement to equally share the costs of its upkeep and maintenance. the agreement was recorded in the county recorder's office. two years later, the neighbor built a new driveway located entirely on his lot. the common driveway, which the landowner continued to use but which the neighbor no longer used, began to deteriorate. the landowner asked the neighbor for money to maintain the common driveway, but the neighbor refused to contribute. three years later, the neighbor conveyed his lot to a friend. the friend entered into possession and used only the driveway built by the neighbor. by this time, the common driveway had deteriorated badly and contained numerous potholes. the landowner asked the friend to pay half of what it would take to repair the common driveway. the friend refused. the landowner repaired the driveway and sued the friend for 50% of the cost of repairs. will the landowner prevail?

Scenario: you have advised the owner of bond's gym that the best thing to do would be to raise the price of a monthly membership. the owner wants to know what may happen once this price increase goes into effect. what will most likely occur after the price of a monthly membership increases? check all that apply. current members will pay more per month. the quantity demanded for memberships will decrease. the number of available memberships will increase. the owner will make more money. bond's gym will receive more membership applications.

Your debit card is stolen, and you report it to your bank within two business days. how much money can you lose at most? a. $500 b. $25 c. $50 d. $150